The adjusted trial balance for Boreal Rock Climbing Centre is as follows:

Instructions

a. Calculate profit or loss for the year. It is not necessary to prepare an income statement.

b. Prepare a statement of owner?s equity. The owner, Lil Massak, invested $3,700 cash in the business during the year. (Note: This transaction has been correctly recorded.)

c. Prepare a classified balance sheet.

d. Prepare closing entries.

e. Use T accounts to post the closing entries and calculate the balance in each account. (Ignore the accounts not aff ected by the closing entries.)

f. Prepare a post-closing trial balance and compare the balance in the L. Massak, Capital account with the information in the statement of owner?s equity.

What alternatives should be considered when deciding on the presentation of information in the classified balance sheet?

Transcribed Image Text:

BOREAL ROCK CLIMBING CENTRE Adjusted Trial Balance January 31, 2021 Debit Credit Cash $ 9,650 Short-term investment 9,375 Supplies Equity investments (long-term) Land 1,780 20,000 58,500 Building Accumulated depreciation-building Equipment Accumulated depreciation-equipment Accounts payable Salaries payable Notes payable ($5,500 must be paid on May 1, 2021) L. Massak, capital L. Massak, drawings 165,000 $ 27,500 45,250 22,625 7,355 1,250 110,000 150,700 52,500 Service revenue 114,300 Depreciation expense Interest expense Insurance expense 10,025 4,950 5,625 Salaries expense Supplies expense Utilities expense 37,200 7,125 6,750 $433,730 $433,730